Division of Economics, Nanyang Technological University (NTU),

Jinjarak,代写留学生论文 Yothin—Foreign direct investment and macroeconomic risk
Motivated by the macroeconomic fluctuations and policy regime switches frequently observed in developing countries, this paper provides cross country-industry evidence on the links between a host country’s macro risks and foreign direct investment (FDI) activities. For each industry I measure vertical FDI share as a ratio of exports to a parent country relative to local sales by foreign affiliates. Using a panel sample from 1989 to 1999, I find that FDI activities of US multinationals in industries with higher share of vertical FDI respond disproportionately more to negative effects of macro-level demand, supply, and sovereign risks.
However, when institutional quality and total FDI share of the host country are sufficiently
low, the merits of cross-industry vertical versus horizontal FDI in response to macro risks disappear. Journal of Comparative Economics 35 (3) (2007) 509–519. Division of Economics, Nan yang Technological University (NTU), S3-B2A-06, Singapore 639798.
  2007 Association for Comparative Economic Studies. Published by Elsevier Inc. All rights reserved.
JEL classification: E32; F21; F23; F40; L16; P51

Keywords: Horizontal and vertical FDI; Institutions; Macroeconomic volatility; Multinationals

1. Overview
What is the main driving force of foreign direct investment (FDI)? This paper adds to a se-
ries of literatures studying the association between institutions, macroeconomic risks, and FDI.

codifies industries started (stopped) reporting in the B.E.A. surveys from year 1999 on. Some industries which the survey started reporting in 1999 are closely related to some pre-1999 industries: “Industrial machinery